DISTRICT LOSES MORE THAN $1,000,000 IN REVENUES, BUT MIGHT GET A MILLION BACK IN SURPLUS

It was Tuesday, December 11th and Council was beginning their budgeting for 2013. The first presenter was Steve Christiansen, community treasurer who was going through the revenues. He explained taxes make up the bulk of the revenues and the other revenues were grants from the Province.

“When we compared this year’s budget vs. next year’s budget, we have a fall down of over a million dollars,” said Christiansen.

He explained to Council, there were several reasons for this. One of which was the fickle nature of building permits. In 2012, they had predicted $1,000,000 would come in from building permits. In 2013, they anticipate $250,000 in building permits.

He explained the reason for the high forecast was in 2012 was due to the Rio Tinto Alcan expansion. They applied for their building permits well in advance of construction.

Last year, the District was also able to achieve several Small Community Grants. However, those grants were cut in half for the next two years. He was grateful to get the advance notice on the cutting of these grants because usually, people do not receive advance notice.

These grants included the Small community’s protection grant and the traffic fine sharing grant. Christiansen told the Council this drop was across the Province.

Christiansen expressed all of these add up to the change in the taxes. He told Council the return on investments was positive. Investments using the reserves went into bonds rather than GIC’s.

He did however, tell Council they were expecting a $1.3 million surplus, but he would not have an accurate number until the end of February, 2013. He explained it would come from the excess amount of money from the building permits and the traditional surplus at the end of every year.

Councillor Mario Feldhoff wanted to know if the assessments would have an effect on the taxes.

Christiansen replied: “We try to keep the amount of taxes we raise constant but maybe build in a 2% increase. If assessments go down 20%, we would raise taxes 20% + 2% to 22% to counteract it. If Assessments go up, we drop the tax rate. The amount of taxes is what we are interested in. Assessments can kind of muddy the waters but they probably won’t impact us too much.”

After explaining the revenues, Christiansen showed Council two significant variances from last year’s expenditures budget.

The first of which was the PST coming back into effect on April 1st. The impact on the District of Kitimat is estimated to lose $211,000 and over $400,000 in 2014. The second change was in environmental health services and was due to a demand from the Ministry of Environment to monitor the landfill. The monitoring was estimated at $90,000.

With the conclusion of his presentation, the department heads were about to step up to present. They would be the bulk of the two meetings. Read about their budget summaries tomorrow.

Public Funds Management!?

Comment by Leon Dumstrey-SooS on 22nd March 2013This report appears to be very confusing:Loses, Surplus, Not quite "complete", etc. so, which is which? Futher in my oppinion, there is an indication that there have been many "misses" , speculative Math. and lot of "guesswork"! Is this how Budget is presented?